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Western Digital, which jointly runs Toshiba's main semiconductor
plant, has been feuding bitterly with its Japanese partner over
the $18 billion sale and has sought a U.S. court injunction to
prevent any deal that does not have its consent.
"I must make it clear that Western Digital will not consent to a
transaction with the proposed consortium," CEO Stephen Milligan
said in a letter sent to Toshiba's board.
The June 25 letter, seen by Reuters on Monday, said that SK
Hynix's participation in a consortium purchasing Toshiba's
interests in their joint ventures "increases the likelihood of
technology leakage and harm to the JVs going forward."
Toshiba last week chose a consortium of Bain Capital and
Japanese government investors as preferred bidder for the unit,
the world's No. 2 producer of NAND flash chips.
The South Korean chipmaker, which is relatively weak in NAND
flash memory chips, will provide half of the 850 billion yen
($7.6 billion) that Bain plans to put up in the form of
financing, sources have said.
Toshiba CEO Satoshi Tsunakawa told a news conference on Friday
that SK Hynix would not be holding any equity and would not be
involved in management - an arrangement that was unlikely to
raise regulatory red flags and would prevent leaks of key
technology information.
Toshiba is rushing to clinch an agreement by June 28, the day of
its annual shareholders meeting.
(Reporting by Makiko Yamazaki; Editing by Edwina Gibbs)
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